Gilead shares climb; AT&T, Amgen shares fall

IBB biotechnology ETF up after hours, underscores big day for biotech, health-care

SAN FRANCISCO (MarketWatch) — Gilead Sciences Inc., AT&T Inc. and Amgen Inc. were among the stocks actively trading Tuesday evening, with shares of Gilead climbing after handily beating Wall Street’s quarterly earnings and revenue expectations and reporting a sales surge for its new hepatitis C treatment.

Bloomberg News

Gilead Sciences
GILD, -1.50%
reported late Tuesday that non-GAAP first-quarter net income, which excludes acquisition expenses and other one-off items, was $1.48 a share and said revenue reached $5 billion. The research-based biopharmaceutical company was expected to post quarterly earnings of 92 cents a share on revenue of $3.96 billion, according to FactSet consensus estimates.

Shares of Gilead climbed 2.5% Tuesday evening after a halt in after-hours trading. The company also said sales of its new treatment for hepatitis C soared in the first quarter, helping the biopharmaceutical company’s bottom-line to triple.

AT&T
T, +1.32%
saw an adjusted profit of 71 cents a share and said revenue grew 3.6% to $32.5 billion in the first quarter. That compared with analyst expectations for earnings of 70 cents a share and revenue of $32.4 billion. Shares of AT&T fell 1.6% in after-hours dealings.

The telecommunication giant also raised its revenue outlook for the year, projecting growth of 4% or more, versus its previous call for a 2% to 3% increase.

Discuss key earnings announcements before and after results come in. Learn more

Tuesday was a big day for biotech and health-care companies. The biotech sector in particular had a spectacular run earlier this year and then a sharp retreat in March. It’s recovered, somewhat. The iShares Nasdaq Biotechnology ETF
IBB, +0.14%
which has been acting as a proxy on investor sentiment, climbed 0.4% in after-hours dealings after closing out the regular session with a gain of 3.3%.

After the close, Amgen Inc.
AMGN, -0.61%reported first-quarter adjusted income of $1.87 a share and sales of $4.52 billion. The biotechnology giant was forecast to report earnings of $1.94 a share and revenue of $4.76 billion in the first quarter. Amgen shares were down 2.9% Tuesday evening.

Intuitive Surgical Inc.
ISRG, -2.41%
said first-quarter net income was $1.13 a share with sales falling to $464.7 million. Intuitive said the $1.13 figure excluded $1.54 in deferral of revenue on the company’s new da Vinci Xi surgical system and liability litigation charges. That would have brought adjusted earnings to $2.67 a share.

The robotic surgeon maker was expected to report quarterly earnings of $3.29 a share on revenue of $514 million. Shares fell 7.8% after hours.

VMware Inc.
VMW, +1.35%
reported a first-quarter adjusted profit of 80 cents a share. Analysts expected non-GAAP earnings of 79 cents a share, excluding stock options expenses. Quarterly revenue was $1.36 billion, in line with analysts’ expectations. Shares of the company shed 4.9% at last check.

Late Tuesday, Yum Brands Inc.
YUM, +0.01%
shares tacked on 2.8% after the parent company of KFC, Taco Bell and Pizza Hut reported adjusted net income of 87 cents for its first quarter. Analysts forecast earnings of 84 cents a share.

Ahead of late Tuesday’s financial results, Pension Partners’ Director of Research Charlie Bilello said that with 21% of companies in the S&P 500
SPX, +0.18%
reporting so far, earnings have been “decent,” with 74% of them having beaten on the bottom line.

But sales were “underwhelming,” with only 49% having beaten on the top line, he said. “Lack of sales growth this late in the cycle could be a troubling sign and investors should watch this trend closely throughout the remainder of earnings season.”

Earnings surprises, meanwhile, “have been relatively in-line with the past few quarters while sales surprises are the weakest since the first quarter of last year,” he said.

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